“What is money?” One of the hardest questions in the world to answer. Here is my best shot!

What is money? That is actually one of the hardest questions in the world to answer and here is my best shot. So what is money? Money is a container for value. What do I mean by a container? Think of it like a battery. Money is something that holds value for later. Just like a battery holds energy for later, money holds value for later. So what is value? Value is created anytime someone helps someone else accomplish their goals, make the world a better place, produce something, make something, fix something, that creates value. When you go to work, you create value for the other person and they reward you by it's a value exchange. You get money in return. Well, they need a way to store that value as they transfer it to you. And you need a way to store that value while you're waiting to spend it. money would not be required if your employer knew exactly all of your needs and had had exactly everything you needed every paycheck. Every two weeks they you would use what's called barter, which if they had knew all of your needs and perfectly timed it and the amount of work you did exactly matched all of your needs, every two weeks you could use barter, which is every two weeks they give you one week it'd be a pair of shoes, a chicken, uh a couple of Papa John's pizzas. every time you went to work every two weeks, they would just give you a bunch of stuff which just happened to be exactly what you needed. But a modern economy doesn't work that way. There's no way you can run an economy, a modern economy where your employer knows exactly what you need every two weeks in perfect increments. And there's no way to buy something like a car because what are they going to do? Give you one car part every two weeks and at the end of five years you put the car together? Like not that doesn't work. So the value exchange from you working, your time and energy needs to be saved up somehow. Just like power, electricity needs to be saved up in a battery. Your time and energy needs to be saved up in some sort of a container so that you can use it later. Maybe you save it up, charge up that battery of your time and energy, which is called money. Maybe you charge it up where you have enough money where you can buy a car or you can go to the grocery store. You could buy all of your needs. You need a container for that value that you created for the other person by working for them. You created value for them by fixing their plumbing and they're going to exchange something to value. They they need to exchange value back to you. And we use money to do that. Okay? So, money is a container for value similar to the way a battery is a container for energy. It lets a lets you store up energy for later. Money lets you store up. It's a way to uh store up value for later. Okay. So, what makes a good money? What makes a good money is the thing that is most scarce uh degrades over time the least. Okay. So, money also needs to be it needs to be durable. It needs to be divisible. It needs to be fungeible, meaning all the different units are the same. It needs to be identifiable. There's some other characteristics, but the number one most important one is scarcity. Money needs to be scarce because the rate at which that that battery for your for value we call money the rate at which it does a good job and doesn't lose charge over time depends on its scarcity. If somewhere somewhere every someone is making new containers those containers that are ma being made out of thin air without creating any value to go with them are sucking energy in this case value. They're sucking value from your money because all of the value that's created, the the money represents all the value that was created. And if somebody is creating more of that money without creating value, like the government does when they print money out of thin air, um when they're creating that, it dilutes the value that is held by all of the money that already exists. So scarcity is the most important thing in a money. Uh another way of explaining what money is, Jack Mer is one of my favorite people in the Bitcoin world. multi-run strike. Uh Jack Mallers always says money is your time and energy in an abstracted form. Let's unpack that one. Your time and your energy in abstracted form. So when you work, you're spending time and energy. So essentially all value that is created in the world starts by some someone expending time and energy. That time and energy is reflected in money. That's why he says money is time and energy in a abstracted form. Abstracted mean instead of like physically touching, seeing and looking at your time and energy, the money represents that time and energy or it represents someone else's time and energy that was expended in the past and maybe you inherited it. Maybe it was gifted to you but that money represents time and energy of someone somewhere typically you typically paid about every two weeks but it it represents that. So that is time and energy in abstracted form which is another way of what I said earlier which is money is a battery for value. It's your time and energy in abstracted form. It's your your time and your energy saved up in something that represents your time and energy. That's what the word abstracted form means. It's in you know a a representation of your time and energy is money. Again another way to think about it which I think is easier for some people is to think about it as a battery for value. the value that was created by your time and energy. So, it's a uh money is a a container, a battery for your time and energy and the value that you created with your time and energy, which lets you then expend that value later by buying stuff. In a barter economy, you're not trying to save up time and energy for later. You're not trying to store value for later. You're just trying to get what you need right now by giving what someone else needs right now. Again, that does not work in a modern economy. So, we have money. The US dollar does not work well as as money because the government prints about 7% more of it every single year, which means the value of the existing money keeps dropping because that new money did not have any value that was used to create it. There was no time or energy. There was no time or energy that went into creating that new money, which means it dilutes the value of the time of the money that already exists. Uh, a good money is scarce. Uh, the best money other than Bitcoin as far as scarcity is gold, but Bitcoin is more scarce than gold. There will only ever be 21 million Bitcoin. Although they are divisible, just like a pizza is is divisible into separate slices. That doesn't mean there's more pizzas. It just means that you can get smaller and smaller units if you want to pay someone with a bite of pizza instead of an entire slice of pizza or a whole pizza. Bitcoin works the same way. You can divide it. It doesn't make more Bitcoin, but you can do parts of a Bitcoin to pay for a cup of coffee or something like that. Um, so money is a container for value. It is a battery for value. It is time and energy in abstracted form. And if you ask people on the street, what is money? They have no idea. Like you will get a million answers. Most people are confused. They're like, uh, that's the stuff you you buy stuff with. It's like, but wait, what is it? Why can you buy stuff with it? And you will get blank stairs. Almost nobody in the world knows what money actually is unless you're into Bitcoin. If you're into Bitcoin, you're asking all of these sort of deep questions about why do we do things? Why do we work? Why do we work for each other? How do we store up our time and energy? What is a good way to store our time and energy? Why is Bitcoin a better way of storing our time and energy than the US dollar or any other thing we could use as money, including gold? Why is gold not a good way to store your time and energy? because it's not portable enough, it's not divisible enough, it's not authenticatable enough, among other reasons. So, Bitcoin is the best money. It is the best way to store your time and energy. It is the best representing representation of your time and energy. If your time and energy in abstracted form is what money is, Bitcoin is the best money. If money is a battery for value, Bitcoin is the best battery for value. And Bitcoin has the benefit that it comes with a network to distribute it. So the unit of Bitcoin is the actual battery that stores the value. But the Bitcoin network is how you transmit it around the world to each other. See, the US dollar doesn't work that way. Even if it did store value, well, the US dollar does not have an automatic network. You have to use the Swift network, the Fed wire network. You have to use PayPal, Vinmo, you have to use all these different services because the US dollar does not have a network to distribute itself automatically, which is why the US dollar is transmitted again with Fedwire, with uh Swift, with um with uh um the I forget the international, you know, Fed wire, you know, there's there's an international payment system I'm forgetting as well. Uh but anyway, all of those things had to be built because US dollar doesn't have a payment network built in. Bitcoin does. The Bitcoin unit, a Bitcoin, is a battery for your time and energy. It is money. But the Bitcoin network was built with Bitcoin to enable you to transmit your Bitcoin all anywhere in the world in a matter of seconds irreversibly. No one can take it away from you. Nobody can block it uncensorable. It's really incredible technology. And when you start asking the question, what is money? And you start really understanding the answer to that question, what is money? It is absolutely eyeopening. And it changes how you think about the world. It changes how you think about work. It it changes how you relate to other humans. And it does that in a way that results in all of those being much healthier all around.